Failing to attract enough customers is worrying - but if you know why it’s happening, you might be able to turn things around. Here are six reasons why customers could be going elsewhere, and what to do about it
1. Your prices are too high - or too low
If your prices are perceived to be too high, then they could drive some or all of your potential customers away. It's important to understand where customers are prepared to splash out and where they would rather go without.
Another point some business owners don’t realise is that pricing too low can create the impression that your products or services are low quality - which can be equally off-putting.Customers are not always looking for the cheapest option. The key to price setting is knowledge of your market, both customers and competitors.
The aim, of course, is to set optimum prices, which allow you to maximise your profits while still remaining attractive to customers. If you can't compete on price, you need to focus on service and the end-to-end customer experience
2. Your products/services are outdated
Perhaps your products or services just aren’t as attractive as they once were. Maybe your competitors’ products or services are superior to yours. Maybe yours look a little old hat.
Evolution can be the key to longevity in business, which means you might only have to enhance or update your products. Alternatively, you might need to introduce new ones and phase out outmoded products or services.
Before spending significant sums on developing a new product or service, carry out thorough market research.
3. Your premises need rethinking
This is most relevant to offline retail businesses, of course. Outdated, poorly decorated, cramped or otherwise uninviting premises can deter footfall.
Operating from a hard-to-reach location can be another reason why businesses fail to attract punters. Despite your best marketing efforts, you might not be able to attract sufficient footfall in your present location, which means you’ll have to rethink your business model or move to a better location.
4. Your customer service is lacking
You might believe you look after your customers’ every need whenever you interact with them - but would they agree? Do you really understand your customers? And what about your employees - do they provide the levels of service required to attract and retain customers? What about when they’re handling customer complaints?
You should aim to exceed expectations, and good customer service can help you to sell more to your existing customers. Do you and your people need to brush up your customer service skills?
When you are being squeezed on margins, it's natural to look at ways of keeping costs down while keeping customers coming through the door. Sadly, what often happens is that costs are cut in the customer-facing areas, such as training budgets which directly impacts customer service.
You need to find the balance between reducing costs and improving the customer experience. It's crucial that customers' needs are met and that you continue to find new ways to engage with your customers and create stronger relationships with them.
5. Your marketing reach is poor
Lack of promotion, or promoting your business in the wrong way, could explain why you’re not attracting enough customers. If people don’t know you exist, they won’t buy from you.
If your promotional activity fails to reach potential customers, and convince them to find out more about you, you’ll simply be wasting time and money.
From online marketing, social media and advertising through direct marketing to exhibitions and PR, there are many ways to engage potential and existing customers. The key, of course, is to find out which methods work best for you.
Another way to stay on the right track is to devise a marketing plan. If your business is to get to where you want to take it, you have to know which road you need to take.
6. Your market has disappeared
The sad fact is that many products, services and indeed businesses simply come to the end of the road and there is no longer a market for them.
This happens because customer tastes, wants and needs change, and the firm's business model isn't agile enough to adapt.
It pays to make sure your market knowledge remains current. Keep up to date with trends and developments in your sector - such as new processes, tech or innovation by competitors - to stay ahead of the curve.